CVC Capital nearing deal for roadside recovery group RAC

Private equity firm CVC Capital is reportedly expected to announced a €2.2bn (£1.55bn) deal to take a majority stake in roadside recovery group RAC.

CVC – the biggest shareholder in Formula One racing – has finalised a deal to acquire close to 50% of the RAC from Carlyle which bought the company in 2011, according to Sky News.

The private equity giant approached one of the owners of RAC in October with a £1bn offer, with reports suggesting CVC was in for the long-term and so ruling out a listing of the group.

Sky said the agreement will be the first deal struck by CVC's new Strategic Opportunities Platform, a vehicle focused on longer-term investments.

CVC will join Singapore's Government Investment Corporation (GIC) on the RAC's share register, with the roadside recovery firm's management also holding a stake.

Insurer Aviva sold the RAC in 2011 to focus on its core insurance operations but was seen to have undervalued the company by offloading it for £1bn.